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NewsRaymond Doherty
17 Apr 2018 10:18am

Kingman to lead government’s FRC review

The government has launched an independent review of accountancy watchdog the Financial Reporting Council (FRC)

The “root and branch” review will assess the FRC’s governance, impact and powers, to help ensure it is fit for the future, according to the Department for Business, Energy & Industrial Strategy (BEIS).

Sir John Kingman, chair of UK Research and Innovation and chairman of Legal and General plc, will lead the inquiry, which is due to be completed by the end of 2018.

Business secretary Greg Clark said the UK has a “strong reputation” as a place to do business but, “This needs to be continuously updated and it’s important to ensure all of our regulators continue to drive high standards”.

He said the review aims to make the FRC the, “Best in class for corporate governance and transparency, while helping it fulfil its role of safeguarding the UK’s leading business environment”.

“This review is part of the government’s Industrial Strategy aim of creating a business environment that ensures our regulators are fit for the future and our markets are working for consumers,” added Clark.

Sir Win Bischoff, chair of the FRC, welcomed the announcement. “Meeting public expectations means using our powers effectively, working closely with other regulators and identifying where gaps in those powers exist.

“The review will ensure we are best placed to support UK efforts to attract investment in business for the long term.”

The FRC has come in for criticism recently for failing to spot trouble at Carillion. At a hearing in front of the BEIS and Work and Pensions Committees, MPs said the FRC had been “useless” when it came to Carillion and its auditors and was “toothless” and “ineffective” as a regulator.

Steven Haddrill, FRC chief executive, argued that its failure to act before it was too late was due to a historical lack of government interest in expanding FRC powers.